Send to a friendSPEAKER BREAKS OFF DEBT TALKS - OBAMA: 'I couldn’t get a phone call returned' - BOEHNER: 'Dealing with the White House is like dealing with a bowl of Jell-O' - Meeting, 11 a.m. in the Oval

SPEAKER BREAKS OFF DEBT TALKS - OBAMA: 'I couldn’t get a phone call returned' - BOEHNER: 'Dealing with the White House is like dealing with a bowl of Jell-O' - Meeting, 11 a.m. in the Oval

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THE SUMMER’S BIG BREAKUP: After rarely courting over the previous two years, the pair had an intense summer they’ll never forget: a big outing, frequent dates (albeit with an occasional third wheel), shared secrets, furtive glances, grand dreams, their friends cheering them on. But it was promises, promises – all the time promises. President Obama complained that Speaker Boehner never wants to talk about problems – he just leaves. Speaker Boehner stewed that President Obama doesn’t know what he really wants, and keeps changing his mind. There were breakups and reconciliations. But they stayed together to protect their reputations around campus, and for the good of the country. The President gave the Speaker his freedom, figuring that if what they had was really real, he’d come back before long, and they could consummate things before going off on separate vacations.

Then yesterday, SPLITSVILLE. And we’re not talking moping, or regret, or private tears. They were so furious, they told EVERYONE. To make sure their side of the story got out, both of them went on live TV to spill all the gory details: the betrayals, the dalliances, an ignored phone call, an unhealthy obsession with the base, the failure to deliver at climactic moments.

In a 12-paragraph “Dear Colleague” letter to House Republicans after the markets closed, Boehner wrote: “A deal was never reached, and was never really close. In the end, we couldn’t connect. Not because of different personalities, but because of different visions for our country.”

Obama was left alone at the altar – scorned, fuming. “Up until sometime early today when I couldn’t get a phone call returned, my expectation was that Speaker Boehner was going to be willing to go to his caucus and ask them to do the tough thing but the right thing,” the president seethed during an epic dinnertime appearance in the White House briefing room. Pressed for details on the phone slight, he rubbed it in: “I’m less concerned about me having to wait for my phone call returned, than I am the message that I received when I actually got the phone call.”

The conspiracy theory among some reporters and staffers was that the President and the Speaker each knew what they were going to have to cave on at the last moment, and may have even told each other: “Look, this is what I have to say to get my people on board. It’ll help if we look mad at each other. It’ll turn out fine.” If that’s the deal, they should both get Academy Awards.

Going before cameras in a yellow tie, just over half an hour after the president, a placid Boehner declared: “The discussions we've had with the White House have broken down … [T]he White House moved the goalpost.” Looking down at notes, he continued: “I take the same oath of office as the president of the United States. I've got the same responsibilities as the president of the United States. And I think that's for both of us to do what's in the best interests of our country. And I can tell you that it's not in the best interests of our country to raise taxes during this difficult economy.” Concluding his opening statement, he zinged: “I’m confident that the bipartisan leaders here in the Congress can act. If the White House won’t get serious, we will.”

In response to the first question, Boehner took a shot by saying that he wasn’t going to take a shot: “Dealing with the White House is like dealing with a bowl of Jell-O. I'm not going to get into the partisan sniping that we heard earlier.”

There’s been plenty of theater and posturing, but last evening’s blowup sure looked like the real thing. Republicans don’t like the term “grand bargain,” which has negative connotations with their people. They prefer “big deal.” Whatever you call it, it looks more distant than ever.

Obama and Boehner seemed to realize they both would benefit from a huge accomplishment that showed Washington could work. Boehner wants to be known as a successful statesman, not a partisan hack. And Obama needs to avoid any shock to the ailing economy. They discussed the big enchilada, including cuts to Social Security and Medicare, in the Oval Office on July 3, in a meeting that went unreported for several days. Then, this Sunday, Boehner and his No. 2, House Majority Leader Eric Cantor, met secretly with White House Chief of Staff Bill Daley and Treasury Secretary Tim Geithner, in Daley’s West Wing office. The president dropped by twice.

At 6:06 p.m. yesterday, the president strode into the James S. Brady Press Briefing Room, an appearance that had been announced just 20 minutes earlier. The energy-efficient overhead lights were cool, but he was hot. He kept going for half an hour, intruding on the 6:30 p.m. start of the network news shows, usually a sacrosanct hard stop for newsmakers. “I just got a call about a half hour ago from Speaker Boehner, who indicated that he was going to be walking away from the negotiations,” the president began. “I thought it would be useful for me to just give you some insight into where we were, and why I think that we should have moved forward with a big deal. Essentially, what we had offered Speaker Boehner was over a trillion dollars in cuts to discretionary spending, both domestic and defense. We then offered an additional $650 billion in cuts to entitlement programs -- Medicare, Medicaid, Social Security.”

Then, the exasperated Obama put on his principal’s hat: “We have now run out of time. I told Speaker Boehner, I’ve told Democratic Leader Nancy Pelosi, I’ve told Harry Reid, and I’ve told Mitch McConnell, I want them here at 11 a.m. tomorrow. … And they are going to have to explain to me how it is that we are going to avoid default. And they can come up with any plans that they want and bring them up here and we will work on them. The only bottom line that I have is that we have to extend this debt ceiling through the next election, into 2013.”

When Norah O’Donnell of CBS News asked about details of the rift, Obama replied: “[W]hat I’ll do is we’ll do a tick-tock, we’ll go through all the paper. We’ll walk you through this process. … [E]ssentially what they had agreed to give on is to get back to a baseline -- this starts getting technical.” After continuing his explanation, the president looked for the Fox News correspondent: “Wendell. Where’s Wendell? Wendell is not here. Lesley. Is Lesley here?”

His final thought: “[A]t some point, I think if you want to be a leader, then you got to lead. “

White House officials then briefed reporters in the Roosevelt Room for 45 minutes, with one of them saying: “[T]he truth is, if saner heads prevail and something along the lines of what we were talking about with Speaker Boehner would resurrect itself, I think that would be something that that would be the best outcome for the country.”

Reporter: “This is not dead? “

Senior White House official: “Not at all. We have to focus on both how we are going to make sure we avoid default, but there is still an opportunity here to do significant deficit reduction if the parties will work together.”

Reporter: “So you can do something with this plan, right? So it’s not dead?”

Senior White House official: “The Speaker withdrew from the talks. So this plan is -- this offer is still available.”

During his presser before a row of flags in the Capitol, Boehner told reporters: “There was an agreement, some additional revenues, until yesterday when the president demanded $400 billion more which was going to be nothing more than a tax increase on the American people. And I can tell you that Leader Cantor and I were very disappointed in this call for higher revenue.”

At the Roosevelt Room briefing, a White House official cast it differently: “In tax reform, we were apart by $400 billion. We'd agreed to set a level of a target for tax reform that would be $800 billion above the level that it would be if the Bush tax cuts were extended. We said on top of that, we thought it was appropriate -- given the scale of savings in so many important entitlement and discretionary areas -- that balance required that there be a little more, and we said $400 billion more was something that we thought was appropriate.”

The briefing drew a riposte from the Speaker’s staff. In an email to reporters with the subject line, “A note on revenue,” an aide said: “Despite what WH briefers may be saying, any new revenue in the framework would NOT have been generated by letting the current tax rates expire. That is simply false. Under the framework discussed, a CEILING was agreed upon that could generate $800 billion in new revenue over ten years.

“This would be done through comprehensive tax reform that would clear out deductions, credits, and loopholes in the system – and spur economic growth. After the gang of six plan came out, the White House moved the goal posts and insisted on $400 billion more in higher taxes – a 50% increase in revenue – and wanted that to the FLOOR instead of the ceiling. The President acknowledged this in his remarks tonight. ‘Letting tax cuts expire’ was never part of the tax reform agreed to. Please let me know if you have any confusion over that.”

A Republican aide added in an email to Playbook: “This new demand for $400 billion didn't just pop up yesterday. They sprung it on us Tuesday evening, after they saw Gang of 6. The Speaker and Cantor went over to the White House the next day and told the President he wasn't getting any more revenue. The Speaker talked to the President on the phone the next day and again said we weren't moving on the number. The Speaker spent the day talking with his members, other leaders, and called the President when he had something to tell him. The fact they are focusing on a phone call should tell you they can't defend the fact the President moved the goal posts.”

So the quarreling partners will try to patch things up this morning in the Oval Office. Will the Speaker keep insisting that the President cheated on him? Or can POTUS convince Boehner that what they had together was too good to give up on now. We’ll find out … as Washington turns.

BEHIND THE CURTAIN – “Phone tag and wrong numbers: The collapse of the debt talks,” by Carrie Budoff Brown and David Rogers: “As he had done often during their weeks of budget talks, President Obama tried to get Speaker Boehner on the phone late Thursday, but never heard back. The silence continued into Friday … Obama finally heard from Boehner’s office at 3:30 p.m. Friday: Expect a call in two hours. No, the president responded, how about right now? Not possible, Obama was told, the speaker isn’t available. It was then that the White House knew the president wouldn’t be announcing a grand bargain on the debt and deficit anytime soon. Maybe never. … [B]y the time Obama and Boehner connected at 5:30 p.m., House Republican aides were already briefing Hill reporters on why the talks had collapsed.” http://bit.ly/nikAkX

--“Boehner confident government won't default,” by AP’s Andrew Taylor: “Speaker Boehner says he's confident congressional leaders will be able to come together to avoid a government default following the collapse on budget talks … ‘We can work together here on Capitol Hill to forge an agreement and I'm hopeful the president will work with us.’”

** A message from the National Retail Federation: Retail directly and indirectly provides one in four American jobs and 18 percent of U.S. GDP. With stores in every community, merchants connect daily with consumers and are a key barometer for the economy. NRF is the voice of retailers large and small. Learn more at www.nrf.com/jobs . **

BREAKING – “At least 91 dead in Norway shooting, bomb attack” – Reuters/Oslo: “A suspected right-wing Christian gunman in police uniform killed at least 84 people in a ferocious attack on a youth summer camp of Norway's ruling Labour party, hours after a bomb killed seven in Oslo. Witnesses said the gunman, identified by police as a 32-year-old Norwegian, moved across the small, wooded Utoeya holiday island on Friday firing at random as young people scattered in fear. Police detained the tall, blond suspect, named by local media as Anders Behring Breivik, and charged him for the island killing spree and the Oslo bomb blast. Prime Minister Jens Stoltenberg, capturing the shock the attacks have caused in this normally quiet nation of 4.8 million, said: ‘A paradise island has been transformed into a hell.’ Deputy Police Chief Roger Andresen would not speculate on the man's motives but told a news conference: ‘He describes himself as a Christian, leaning toward right-wing Christianity, on his Facebook page.’”

REMEMBERING CHUCK MANATT: Charles T. Manatt, a former chairman of the Democratic National Committee and one of the best-known Democrats of the Reagan and Clinton eras, died Friday night at age 75, with his family keeping vigil. Manatt held a unique role as a leader in business, but was a devoted Democratic operative. He was the founder of the powerful Los Angeles law firm Manatt, Phelps & Phillips LLP, and remained a partner. He lived in Washington at his death, and was an emeritus chairman of the board of trustees of The George Washington University.

Manatt was an avid hunter, and was known for hosting a St. Patrick’s Day pheasant shoot. As DNC chair from 1981 to 1985, he led a party that was disillusioned and out of power, with President Ronald Reagan in the White House. In 1987, he was named national chairman of then-Sen. Paul Simon's presidential campaign, after serving as national chairman of Gary Hart's short-lived campaign. In 1992, Manatt was co-chairman of the Clinton-Gore campaign. President Bill Clinton later named him U.S. ambassador to the Dominican Republic, where he served from 1999 to March 2001. He was a Democratic superdelegate in 2008.

--L.A. Times obituary, by Mark Z. Barabak: “Manatt died at Kindred Hospital in Richmond, Va., of complications from a stroke suffered after surgery in November, according to his daughter, Michele A. Manatt. … ‘We were friends for 30 years,’ former President Clinton said in a statement, ‘and I saw firsthand how he used his energy, intellect, and common sense to help restore the Democratic Party after 1980, to make America more prosperous and just, and to make friends for our nation around the world.’ … While at Iowa State, Manatt married Kathleen Klinkefus, his high school sweetheart and a fellow student. In 1964, the couple moved to Los Angeles, where Manatt took a job with the powerhouse law firm O'Melveny & Myers. …

“His law firm served as a kind of farm team for party operatives. … Manatt owned livestock farms in western Iowa, where he grew up, and was a frequent visitor, even outside the political season. … Besides his wife of 53 years, Manatt is survived by daughter Michele, sons Timothy and Daniel, and three grandchildren. The funeral and burial will be next week in Audubon, Iowa. A memorial service is planned for September at Washington's Metropolitan Memorial United Methodist Church, with a celebration of his life in Los Angeles this fall.” http://lat.ms/qYTCQ0

REMEMBER THE TIGER COSTUME? The (Portland) Oregonian, “Young woman accuses Oregon Rep. David Wu of aggressive, unwanted sexual encounter”: “A distraught young woman called U.S. Rep. David Wu's Portland office this spring, accusing him of an unwanted sexual encounter, according to multiple sources. When confronted, the Oregon Democrat acknowledged a sexual encounter to his senior aides but insisted it was consensual, the sources said. The woman is the daughter of a longtime friend and campaign donor. She apparently did not contact police at the time. … Reporters could not verify the young woman's age. Notes on Facebook over the past 18 months indicate she graduated from high school in 2010. California records show she registered to vote in August.

“Wu, 56, did not respond to repeated questions … over the past four days. Late Friday, Wu issued a one-sentence response: ‘This is very serious, and I have absolutely no desire to bring unwanted publicity, attention, or stress to a young woman and her family.’ … Sources familiar with the voice mail said it was clear that the woman was the daughter of a high school friend of Wu's … The Oregonian does not use the names of victims of sexual assault without their permission. In this case, the newspaper is withholding some details about the family that might identify them … [T]he alleged incident took place over Thanksgiving weekend. Sources said they were told that the woman went outside and Wu left after her.” http://bit.ly/qQVT1n

HOW DAVID LEONHARDT became NYT’s Washington bureau chief -- Keach Hagey: “In 2008, as the economy sped toward the cliff, economics columnist Leonhardt and his boss and mentor, Larry Ingrassia, made an incredibly prescient decision: to move him from his native New York to Washington. There was not yet a meltdown to cover, but there was a sense that the economy was losing steam and Democrats would soon be sweeping into the White House, which tends to mean the introduction of legislation that affects economic policy. … Three years and one massive recession later, Leonhardt has a Pulitzer under his belt and [yesterday] was named The Times’s next Washington bureau chief. ‘I don’t consider this to be a statement about our relative coverage of say, domestic issues, or economic issues, versus security and foreign issues,’ he said. ‘I think that certainly economics are going to be an important part of the Washington story for the foreseeable future, when you combine the scale of the fiscal problems that we face with the fact that unemployment is at a 30-year high and not falling quickly.’

“His discussions with [incoming Executive Editor Jill Abramson about the job – which she had held earlier in her career – started about a month ago. … ‘Bill [Keller] and Jill are highly engaged in the substance of what we cover,’ he said. ‘So if you run into Bill or Jill in the halls in New York, you often end up having a substantive conversation with them – not necessarily about journalism, but about the issues that you are covering. I have had several of those over the years.’ Leonhardt says the Washington bureau chief job is especially enticing because, as a desk that doesn’t have its own space in the paper [shares with the National Desk], ‘we are able to focus like a laser here on reporting and editing.’ … [H]e satisfies his craving for regionally authentic Chinese food at Sichuan Pavilion in Rockville.” http://politi.co/rscNxr

--ANNOUNCEMENT MEMO: “To the Staff: We are more than pleased to announce that David Leonhardt, one of our finest writers and most elegant thinkers, will be the next Washington bureau chief of The New York Times. David’s strengths as a reporter, columnist and magazine writer are dazzling. His keen understanding of how Washington works and the nexus of politics and economic policy make him a perfect leader of the Washington bureau at this moment. His creativity is matched by his collegiality. His original take on key issues has strengthened our news report in deep and important ways. He is also more than a little webbified, playing a main role both in starting the Economix blog, and a bit more recently, in working with a great interdepartmental crew to craft the ‘deficit puzzle’ that remains among the most discussed features that we’ve done this past year. … He is also, in the words of one colleague, ‘endlessly inquisitive’ --- the most important trait of a good editor. … David’s appointment takes effect after Labor Day, when Dean moves to his new post in New York.

“This is as good a moment as any to say something about the two editors who ---- perhaps more than anyone else --- have helped the make today’s bureau the most dominant in Washington … Dick Stevenson is one of the finest editors and leaders at The Times. He runs a political operation that is our first great success in integrating the Web and the print operations. He has been the go-to person on the budget and the political struggles that have come to dominate Washington. Simply put, he is a remarkable journalist whose knowledge of economics, politics, and Washington is unsurpassed.

“Rebecca Corbett is a knockout enterprise editor who meets the major standard for a great editor --- everything she touches gets better. Under her guidance, the bureau’s enterprise work has been ratcheted steadily upward. She has been a primary editor on the N.S.A. wiretapping story, Wikileaks, and the paper’s political profiles. Obviously there will be much to say in the coming days and weeks, including the shape of David’s desk. But let’s take a minute to toast his appointment, and the achievements of a bureau that continues to dominate Washington. Jill [Abramson], Dean [Baquet] and John [Geddes].”

--PETER BAKER has taken himself out of the deputy stakes.

THE PRESIDENT’S DAY: At 11 a.m., “the President and the Vice President will meet with Congressional Leadership … in the Oval Office. There will be a pool spray at the top of the meeting. Expected attendees include: Speaker John Boehner; Senator Harry Reid, Majority Leader; Senator Mitch McConnell, Republican Leader; Representative Nancy Pelosi, Democratic Leader.”

--THE PRESIDENT’S WEEK AHEAD: “On Sunday, the President has no public events scheduled. … On Monday, the President will address the National Council of La Raza at their annual conference luncheon in Washington, DC. Later in the day, the President will welcome the World Series Champion San Francisco Giants, to the White House to honor the team and their 2010 World Series victory. The President will also recognize the efforts the Giants make to give back to their community as part of their visit, continuing the tradition begun by President Obama of honoring sports teams for their efforts on and off the field. In the evening, the President will attend two DNC events in Washington, DC. On Tuesday, Wednesday and Thursday the President will attend meetings at the White House.

“On Friday, the President will meet with President Boni Yayi of Benin, President Alpha Condé of Guinea, President Mahamadou Issoufou of Niger, and President Alassane Ouattara of Cote d’Ivoire. The meeting provides an opportunity to underscore the Administration’s support for emerging democracies, to highlight our partnerships with these countries, and to discuss the building of strong democratic institutions, economic development, and a range of regional issues.”

--THE V.P.’s weekend, in addition to today’s congressional meeting: “On Sunday, the Vice President will be in Washington, DC. There are no public events scheduled.”

MEDIAWATCH -- WSJ PLANS ONLINE EXPANSION – TalkingBizNews.com, “Wall Street Journal managing editor Robert Thomson sent out a memo to the staff reminding them of the paper’s and Dow Jones’ ethical guidelines”: “Our digital audience is expanding rapidly in Asia and we are about to embark on a significant expansion in Europe. In the US, expect an announcement soon about a project that will certainly enhance our digital profile. We are already looking beyond forex [a global-currency service launched this year] and far beyond the US with proposed projects at Newswires, which is the engine for much of our expansion into other lands and languages.” Full memo http://bit.ly/qElkC5

SPORTS BLINK – “NFL lobs cash into politics,” by Mackenzie Weinger: “The league’s political action committee — the Gridiron PAC — doled out $110,000 to House and Senate incumbents during the last quarter … [T]he NFL spent $440,000 on federal lobbying efforts during the second quarter … Last year, the league spent more on federal lobbying – nearly $1.5 million – than it has in any other full year. The National Football League Players Association, meanwhile, spent $60,000 in both the first and second quarters of this year. Beyond labor matters, issues the NFL reported lobbying on include Internet gambling, concussions, the NFL Network, performance-enhancing drugs.” http://bit.ly/qaQZHm

--SiriusXM's “Polioptics,” with Adam Belmar and Josh King (Sat., noon, 6 p.m. ET): Sarah Lyall, London correspondent for The New York Times, on covering Rupert, James, Wendi and the week that was Murdoch. John F. Harris, Editor-in-Chief of POLITICO, on contrasts between Presidents Clinton and Obama, and how technology will shape coverage of the 2012 campaign. On SiriusXM Ch. 124, downloadable on iTunes and at www.polioptics.com.

** A message from the National Retail Federation: Tens of millions of U.S. workers’ jobs depend on the retail industry. Anybody whose job results in a consumer product – from those who supply the raw materials to factory workers to the truck drivers who deliver it to the store – counts on retail as the crucial point where goods reach paying customers. With 3.6 million stores drawing on a vast array of suppliers, retail directly and indirectly accounts for 42 million jobs and $2.5 trillion of annual GDP. NRF has represented retailers for more than a century, and continues to be the “Voice of Retail in the Nation’s Capital.” Learn more at www.nrf.com/jobs . **

SPEAKER BREAKS OFF DEBT TALKS - OBAMA: 'I couldn’t get a phone call returned' - BOEHNER: 'Dealing with the White House is like dealing with a bowl of Jell-O' - Meeting, 11 a.m. in the Oval - POLITICO Playbook